396C Relief from Corporation Tax for losses of participating institutions.
(1)(a) In this section—
“available losses”, in relation to an accounting period of a participating institution, means losses, carried forward from preceding accounting periods, for which relief is available under section 396(1) in that accounting period or succeeding accounting periods;
“group company”, for an accounting period in relation to a participating institution (in this definition referred to as the “first-mentioned institution”), means a company which is a participating institution that has an accounting period that coincides with the accounting period of the first-mentioned institution where, throughout the accounting period of the first-mentioned institution—
(a) the company is a subsidiary of the first-mentioned institution,
(b) the first-mentioned institution is a subsidiary of the company, or
(c) both the company and the first-mentioned institution are subsidiaries of a third company;
“participating institution” and “subsidiary” have the same meanings respectively as in section 4 of the National Asset Management Agency Act 2009;
“relevant amount” for an accounting period in relation to a participating institution means 50 per cent of the amount, if any, by which the aggregate of the trading income, if any, of the participating institution and its group companies for the accounting period exceeds the aggregate of the trading losses, if any, incurred by the participating institution and its group companies in that accounting period;
“relevant limit” in relation to an accounting period of a participating institution means an amount determined by the formula—
A is the relevant amount for the accounting period in relation to the participating institution,
B is the aggregate amount of the trading income, if any, of the participating institution for the accounting period before any relief for available losses, and
C is the aggregate amount of the trading income, if any, of the participating institution and its group companies for the accounting period before any relief for available losses.
(b) For the purposes of this section—
(i) an accounting period of a company coincides with an accounting period of another company if the first-mentioned accounting period begins on the same day and ends on the same day as the second-mentioned accounting period, and
(ii) references to trading income or trading losses are references to trading income or trading losses, as the case may be, arising—
(I) to a company resident in the State, or
(II) through or from a branch or agency in the State of a company that is not so resident.
(2) Where for any accounting period a participating institution makes a claim under subsection 396(1) for relief in respect of available losses incurred, or deemed under subsection (3) to have been incurred, in a trade carried on by that institution, the amount of the losses which may be set off against trading income of the trade in that accounting period shall not exceed the relevant limit of the participating institution for that period.
(3) (a) Subject to subsection (2) and paragraphs (b) and (c), where in relation to an accounting period—
(i) a participating institution has an amount of available losses (referred to in this subsection as the “excess available losses”) in respect of which it cannot obtain relief for that period, and
(ii) a group company in relation to that institution, having claimed all relief under section 396(1), if any, to which it would otherwise be entitled (including by reference to other claims made under this subsection), could obtain relief, or more relief, under section 396(1) for that accounting period if some or all of the excess available losses of the participating institution were deemed to have been incurred by the group company,
then, on the making of a claim in that regard by the group company, the participating institution may surrender to the group company an amount of those excess available losses that does not exceed the amount for which the group company could obtain relief for that accounting period, having claimed all other relief under section 396(1) to which it is entitled, and—
(I) that group company shall be deemed for the purposes of section 396(1) to have incurred those losses and shall set off the amount so surrendered against its trading income for the accounting period, which income shall be treated as reduced by that amount, and
(II) the available losses of the surrendering company shall be deemed for all purposes of the Corporation Tax Acts to be reduced by the amount surrendered.
(b) More than one group company may make a claim under this subsection relating to the same participating institution and to the same accounting period of that institution but, whether by reference to this section or any other section of the Corporation Tax Acts or any combination thereof, relief shall not be given more than once in respect of an amount of available losses.
(c) A claim for relief under this subsection—
(i) shall be made in the return required to be made under
>section 951< for the accounting period of the group company which is claiming the relief,
(ii) shall require the consent of the participating institution notified to the inspector in such form as the Revenue Commissioners may require, and
(iii) shall be made within 2 years from the end of the accounting period to which the claim relates.
(4) (a) Subject to
>subparagraph (b)<, where the inspector ascertains that any relief claimed in accordance with this section is or has become excessive, he or she may make an assessment to corporation tax under Case I of Schedule D in the amount which in his or her opinion ought to be charged.
>Subparagraph (a)< is without prejudice to the making of an assessment under section 919(5)(b)(iii) and to the making of all such other adjustments by means of discharge or repayment of tax or otherwise as may be required where a company has obtained too much relief.
(5) This section has effect for accounting periods commencing on or after the passing of the National Asset Management Agency Act 2009 .